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This Year In Coworking: 2021s biggest trends.

Highlighting some of the biggest trends and shifts in coworking through the 1,076 stories summarized in 2021's weekly newsletters.
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πŸ’Œ Email-first Summary

This year’s summary wasΒ email-first.Β 

This meansΒ that active ThisWeekInCoworking.com email subscribers got it first (it arrived in inboxes at 6am ET on Dec 30th 2021).Β 

On Feb 9th a web version was published. Dig in below πŸ‘‡

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🀝 Market trends.

πŸ› Governments + Coworking.

2021 saw a range of government interactions with flexible workspaces.Β 

From w1 we saw the Irish government announced the upcoming launch of a national space-booking app. However not all interactions were positive, in w16 we saw the Belarusian regime shut down a local coworking space.Β 

Then came Governments giving employees access to coworking (and other flex) spaces. In w18 the local DC gov partnered up with WorkChew to bring employees back to work. In w34 over 2M federal workers across the US were given a route to leveraging flex spaces through a GSA contract with 3 operators and 2 aggregators. A German state also began offering coworking as an option for their employees in w37.

We also saw an increasing investment into coworking and remote work infrastructure, in w30 the Irish gov provided €8.8M in funding and the state of Massachusetts awarded $1M+ in Collab. Workspace Program grants in w41.

Takeaway: Expect more of this, as governments get more involved with coworking as both employers and economic drivers.

🏑 Coworking in the outskirts, ‘burbs, rural and beyond.

Remote work enabled millions to change, or contemplate changing, where they live (w16) and in turn commute from/to.

This led to a surge in demand for coworking and flex work options outside central business districts, followed rapidly by operators looking to create more supply.Β 

This demand spread across a few markets including, but not limited to outskirts (w38), secondary cities (w14, w19, w31) and the fantastic TED talk in w44), suburban (w21, w48),Β  small towns (w9, w38), rural (w17, w36,Β and more), and locations designed for digital (w5, w28) and local nomads (w35).

Results and uptake are already impressive looking at Serendipity Labs data from w27 and how Tulsa brought in $62M via their remote work program in w49.

Takeaway: Where people want to live, and how they (don’t) want to commute has changed. Accessible spaces near their homes will add a whole new dimension to workspace strategies in the coming months and years.

πŸ’Ό Corporate coworking grew.

Throughout 2021 we saw more and more corporations shift their workplaces strategies, often including access to coworking spaces.

100k bank employees got coworking access in w7, 10k+ employees followed in w8, and then 300k more in w10. And then in w19 Spotify wrote coworking access into their official remote work policy.Β 

Technology adapted and evolved to facilitate corporate coworking including but not limited to centralized billing, team access, vetted security or procedures. See more about this in the tech trend ‘Evolving Discoverability’.Β 

Takeway: Corporations are leaning into flex, be it part of a hybrid strategy or as part of their remote-friendly hiring angles. The opportunity is there.

🀝 Collaboration & alliances.

2020 was tough, but pulled coworking space operators together. These collaborations spilled over into 2021 with more formalized alliances and partnerships forming or evolving across the coworking & flex space sector, and around the world.

In Australia we saw two networks form a member-mobility alliance (w19), a call to form a national alliance (w23) and a ‘peak body’ launch (w30).

We saw new boards for the German Coworking Federation (w35) and the Global Workspace Association (w17).

14 rural coworking spaces in Germany hosted an ‘open-door day in w36, Flexday and a few Canadian spaces & alliances launched Work With Pants campaign in w30, whilst in w33 62 Indian coworking firms formed a nationwide alliance.

We also saw Women Who Cowork celebrate 5 years in w32, the Slovenian coworking coop launched in w39 and the Swiss VillageOffice coop network restructure in w51.

Ashley Proctor and I hosted an international 3-hour event for coworking alliances in April that announced in w16, with the next Coworking Alliance Summit date (Feb 16th ’22) was announced in w46.

Takeaway: Operators of all kinds are understanding & leveraging the collective power of collaborating and acting together.Β 

🏒 Landlords lean into flex.

In 2021 many landlords (and firms managing huge aggregates of office space) not only explored flex, but leaned heavily into bringing flex workspaces into their portfolios.

There were countless examples this year, from Bridge CRE announcing 5 suburban flex spaces called Abridge (w19), to the rise of ‘brandlords’ (w31), to CBRE sharing data about how big the opportunity is for landlord-delivered flex workspaces (w33).

Advice for both landlords and operators looking to partner up (see ‘Management Agreements’ trend) poured in too. We saw advise for landlords on whether they should manage, lease or partner for flex (w25), an article on how landlords value & assess risk of flex space (w48), and an advertorial noting that demand is driving all office owners into the flex space business (w42).

Takeaway: Landlords and office portfolios need to add in flex offerings, and they have a few options as to how to do so. What will win out is up to the market and how each approach are executed.

πŸ“‘ Continued growth of franchise-based flex spaces.

2021 saw early signs of continued success of franchised flexible workspaces with Venture X sharing strong 2020 growth in w3. Serendipity Labs also shared improving numbers across urban, suburban and secondary markers since Jan 2020 in w27.

Whilst we saw newcomers like SUCCESS in w20, long-time operators IWG also shifted a lot of focus towards their franchise business as they planned to open “thousands” of locations (w33) with moves like a JV that led to 32 APAC locations changing hands (w32), 18 new franchise locations in India (w43) and a deal to bring 40 more locations to Thailand (w49).

Takeaway: Much like alliances, franchises benefit from collective actions and buying-power, but as current franchises hit growth pains, it’ll be interesting to see how they continue to scale across nations and continents.

πŸ“ƒ Resurgence of Management Agreements.

As operators adapt to more asset-light models to scale, and landlords seek experience operators to help bring flex workspaces into their portfolios we’ve seen a strong resurgence of Management Agreements across the industry.

From w1 we saw branded coworking management agreements being announced between Ironfire + Howard CDM. We also saw an opportunities to expand to Florida via such an agreement (w22). This trend was definitely not just confined to the US market, with Hub Australia also expanding through this mechanism in Melbourne (w29) and IvanhoΓ© Cambridge tapping WeWork to run a flex space in Montreal (w29).

There was also an uptick in advisory posts or stories around this re-emerging trend, from a primer in w10, to legal firm Boodle Hatfield summarizing the benefits of these agreements for landlords in w26, to a dive into the terminology landlords use to explore and assess management agreements in w50.

Takeaway: Operators and landlords are increasingly experimenting with ways to share the CAPEX and/or revenues. This may be the asset-light foundation on which the next big coworking brands evolve or are built.

πŸ’‘ Coworking and/for X.

This year we saw further expansion of one of the core fundamentals of coworking spaces, namely the sharing of resources across a community of similar entities, outside of the strictly desk-bound industries. We also saw new ‘alternatives’ to coworking emerge.

Hotel + Coworking plays grew rapidly, spurred a bunch by the huge $1.1T dip in travel spend throughout 2020 (w38) with Accor expanding Wojo Spots (w4), a Dutch hotel turning 3 floors into flex space (w8), even more French hotel rooms becoming flex offices (w26) and 47 UK hotel locations joining a flex workspace booking platform (w37).

Coworking + Colleges and Coworking + Kitchens both continued to see renewed interest within large cities like London (w45), as well as newer concepts like flex & fully-services labs (w47). We also saw coworking added to huge work/fitness/play complexes (w8) and apartment buildings in NYC (w25).

Alternatives like Cucumber (w28) and Kitt (w50) also popped up to offer a more concierge-style ops & support for more ‘traditionally’ rented space. This trend is also coupled with the perceived risk of ever-increasing rates and premiums for flex workspaces (w51).

Takeaway: Sharing resources is big business, and with the popularity and sustainability of coworking now shining through, expect to see more similar and competing offerings.

πŸ› Could coworking save retail?

2021 saw some major collaborations, projects and expansions through traditionally retail spaces.

From London’s highstreets (w12), to shopping centers (w29), to upscale pizza spots (w21), to Saks Fifth (w32), to beer and bowling (w43), to Selfridges (w48) and to the resurrection of downtowns (w47) – coworking was (and continues to be) on the minds of the retail real estate professionals across the globe.Β 

Takeaway: Keep an eye on this market, experiments and projects are still early, and we’ll see a whole bunch of new stories and results as we dive into 2022 and beyond.

πŸš€ The coworking 'brand'.

🌍 Coworking and flex offerings ramped up… well.. everywhere.

Throughout 2021 I shared insights about coworking markets, and their recovery, from all across the globe.

We looked into coworking across Africa (w5), India (w8, w44, w49), Vietnam (w20), New Zealand (w29), Singapore (w38, w51), Tunisia (w42), the UK (w42), Latin America (w49).

As the global market, coworking is expected to surpass $13B by 2025 (w32).Β 

Takeaway: Coworking is not a North American invention or ‘product’. Coworking is exploding across the globe, and I do not think we’ll see that slowing down anytime soon.

πŸ—ž Coworking went mainstream.

With the rise in adoption of remote working, changing government policies and more, coworking found itself in the spotlight in a few ways.

There were many MANY mentions in the press and on screens and in the news (often needlessly hyphenated) however here’s a few times coworking “went mainstream” in 2021’s summaries.

In w11, the official trailer for Hulu’s WeWork documentary was released (it aired in w13 during WeWork‘s most turbulent week in the newsletter).

Non-city coworking got the nod in the Boston Globe in w16, a local paper focussed on the benefits of coworking for remote workers in w33, the New York Times explored suburban coworking in w44, WIRED dug into using third places over working from home in w46 and in w48 Forbes shared some great examples of new twists to the “traditional” coworking model.

Takeaway: The media (in most) has begun understanding that there’s 10s of thousands of operators in coworking, all doing something special for their communities. I expect to see more media and focus on them, as well as the new brands being built in, and for our industry.

✊ Driving social impact.

2021 was a hard year for many, but coworking communities around the world stepped up to make a positive impact for both, members of their local neighborhoods, and humanity everywhere.

The first Coworking IDEA challenge and in w5, and went on to issue challenges all year. A Berlin space opened their doors to support locals stay warm in w7, and nearby Tuesday Coworking discounted their membership passes for womxn by the average pay gap to make a point in w9.

We also saw initiatives to support care-givers (w12, w20, w43, w48) , educators (w12), members’ mental health (w26, w30) and the environment (w18, w25).

Takeaway: Many coworking spaces have always led with a community-first mentality. Expect to see more social impact being driven by, and through, these communities.

πŸ’» Boomerang trend: Virtual Coworking.

We entered 2021 with a lot of focus on virtual offerings from coworking spaces and even organizers.

Early on I shared stories about how international members worked virtually in a community ‘in Colorado’ (w2), the opportunity/risk of Clubhouse (w4) and then how members really miss traditional coworking communities (w6).

Then in the second half of the year we saw a resurgence, I believe unrelated to any variants, with Indy Hall going purely-virtual in w30, Station F launching a virtual offering in w43, and a look at how virtual coworking clubs are increasingly popular in w45.

Takeaway: Online communities are huge business, especially now with a growing interest in ‘the metaverse’ and web3 technologies. I would not be surprised if community leaders from the coworking sector build successful and rapidly scalable online communities too.

πŸ€“ Technology trends.

πŸ“² Discoverability is evolving.

I tracked 80+ stories directly related to platforms, firms, brokers, agencies or other mechanisms for humans to find flex workspaces in 2021s summaries.

So many platforms were launched, funded, expanded or repositioned to bring flex workspaces to new markets, or into the new decision-making landscape around where/how/when individuals and teams pick to work.

We saw crowdfunding rounds for multi-space UK membership apps WorkClub and othership (w4) and office-booking app extraSlice (w48).

Traditional VC investment also poured into workplace-aggregator platforms WorkChew in DC (w11), Tally Market (w17) and Hubble (w27) in London, Desana in Edinburgh (w26), and Deskimo in Singapore & Hong Kong (w29).

Where there’s funding there’s also M&A activity, and we saw a number of booking/discovery platforms change hands including Breather into Industrious/CBRE (w22) Upsuite into SquareFoot (w23), WorkClub into Upflex (w50) and 42Floors into Yardi (w51).

There were a tonne of new features added to platforms across the sector from support for teams, to subscriptions, to pass systems, to supporting hybrid team operations, to maps of where nearby colleagues and/or friends are working from.

We saw new market entrants, with their own approaches to booking and accessing space, like PopDesk in NY (w5), offeaze in France (w20),Β  Daybase (w25) also in NY, Narau (w26) and Flow (w37) in the UK, Denizen in Berlin (w40).Β 

A few platforms also rebranded or restructured including Narau to NearU (w35), and meetingsbooker to hubli (w36).

But the real takeaway and undercurrent trend here is what is happening just below the surface.

Discovery and booking platforms are partnering & integrating (w49) with companies way outside the ‘office search sector’ to enhance or even create entirely different ways for millions of humans to use flexible workspaces in creative and productive ways.

Takeaway: How the next 5 million humans will find, pay for, and leverageΒ coworking spaces is still being developed. Keep an eye on new platforms, technologies and nichification of reach and marketing as these new workspace decision-makers are able to make better, faster decisions.

βš™οΈ Workspace Operating Systems and shifting to Ops Stacks.

There’s been an undeniable growth in tech available for offices, with $5.7B invested into office tech providers since 2010 (w34).

We started the year with an essay by Glenn Felson on the race towards a Workspace Operating System (w1), and it’s been a rollercoaster since then of epic proportions.

Over 64 stories were shared on the topic of workspace tech, funding rounds and strategic moves, with some weeks seeing close to a billion dollars in news.Β In w42 for example we saw $10M and $15M raises, alongside some huge M&A moves worth hundreds of millions of dollars.

There were a few key emerging trends I’d like to highlight here.

1. There’s a shift away from monolithic platforms, with operators & funding diverting to solutions that do one thing (or a few things) really really well, as oppose to a suite of OK-ish tools from a central vendor.

Note: having said that I’m still seeing tech updates from, and investments being made into, new and traditional monolithic (all-in-one) plays.

2. Operators are wising up to the importance of integrations, and in a recent poll 100% reported that integrations are important enough to change buying decisions.

3. Tech and solutions we never even thought about (much) before are being added to the Operational Stacks of flexible workspaces, adding to the customer experience and aiming for a more premium offering.

These include desk bookings in Slack (w27), Apple Wallet access (w27), automated burrito bowl kitchens (w38), furniture-rental (w41), office-cleaning robots (w42), hologram rooms (w46) and more.

4. Actionable data will be key to how operators shift from proving the coworking model, to optimizing and tweaking performance, yields and improve sustainability or scale. Expect to keep seeing more analytics features (w44), benchmarking (here) and AI/big-data plays (w51) in this space.Β 

However you look at it, there’s a whole bunch of tech and services available, which is great. What’s not so great is how very little of them talk to each other which results in a bunch of manual work or ‘sticky-tape’ integrations sometimes held together by chewing gum and hope.

A number of platforms have adapted and put focus on their APIs and integrations, like SpaceOS in w30 and all the platforms who’ve completed Syncaroo integrations like OfficeRnD (w22), Upflex (w33), Nexudus (w38), CloudVO (w48), Satellite DeskWorks (w50).

Takeaway: We’ll see even more platforms, an increased focus on integrability and enabling inter-platform workflows and better touch-points for potential and existing customers.

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About This.

ThisWeekInCoworking.com is a weekly newsletter summarizing the coworking celebrations, stories, market moves, tech updates and discussions you may have missed.

Newsletters are curated by Hector Kolonas and made available for free via email or this website.

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